Private investment rose again in October, according to the central bank, indicating the economy is making a little headway though exports and domestic demand remain weak.
The Bank of Thailand said on Monday the economy continues to recover at a "gradual pace", but made clear that gains remain small.
"The economic recovery is still slow, not broad-based and quite fragile," Roong Mallikamas, a senior central bank official, told reporters.
Although a coup 18 months ago ended prolonged political turmoil, Southeast Asia's second-largest economy is still finding its footing as exports have long been soft and high household debt has crimped domestic demand. Growth was 0.9% last year.
The BoT's index for private consumption, which makes up half of the economy, slipped 0.1% in October from the previous month, while investment increased 1.0%, the central bank said on Monday.
It was the fourth straight month the investment index rose.
In October, the BoT said, public spending "continued to be disbursed well" while private consumption on necessary goods and services such as telecommunication and transportation increased.
However, it added, overall durable consumption remained low "in line with low farm income, elevated household debt, and cautious credit extension by financial institutions after the deterioration of credit quality."
In July-September, the economy grew 1.0% from the previous three months and 2.9% from a year earlier. The current quarter should benefit from economic stimulus.
Hurt by tepid demand
The BoT has forecast economic growth of 2.7% for 2015 and 3.7% next year. But deputy governor Paiboon Kittisrikangwan said last week those projections might be cut as risks increased. New BoT estimates are due on Dec 25.
Tepid global demand, especially from China, and structural problems at home are hurting exports and manufacturing.
Exports, equal to more than 60% of GDP, contracted for a 10th straight month in October and will fall a third year in 2015. The BoT has forecast a 5% decline, which would be the deepest drop in six years. It expects shipments to rise 1.2% next year.
The National Shippers' Council has predicted 2% export growth next year but chairman Nopporn Thepsitthar on Monday said he's "worried" the target can't be reached.
October industrial output fell more than expected on weak electronics output despite a recovery in car production.
Thailand is a regional production hub for the world's top automakers and a major maker of hard drives.